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More on Consolidated Statements of Financial Position

We will look at goodwill arising on consolidation in a bit more detail this week. Notes for goodwill are here (pdf).

There’s an illustrative case study, Merton and Peartree, which you should study and try to complete. In this case study, you do not have to calculate the figure for goodwill – it has already been done. However, there are some extra narrative parts (on goodwill) for you to tackle. These will be covered in today’s class, and there is a full solution provided.

You will also need to be able to prepare a combined consolidated income statement and statement of financial position. There’s an example case study Cuba and Mali here – again, a full solution with workings is included.

Associates, Joint Ventures and Equity Accounting

You need to know the basics of accounting in the consolidated financial statements for the results of associated companies and joint ventures. These are explored in this elearning resource.

There is a very useful case study Kroot, Lamkin and Menders (this includes an additional annotated set of financial statements as well as workings, and solutions). This is probably the most complex example of what you should be able to do. There’s another similar case study in Additional Resources [Blade, Crone and Drent].